FIMI urges 15pc customs duty on aluminium to prevent India becoming dump yard for low-quality scrap

THEBUSINESSBYTES BUREAU    

BHUBANESWAR, NOVEMBER 20, 2025

The Federation of Indian Mineral Industries (FIMI) has submitted key recommendations to the Ministry of Finance ahead of the Union Budget 2026-27, seeking urgent policy measures to protect India’s aluminium industry. The apex mining body has urged the government to raise the basic customs duty on primary aluminium and downstream products to 15 per cent to counter rising imports and safeguard domestic manufacturers.

FIMI warned that India’s aluminium sector is facing serious challenges due to a surge in imports from aluminium-surplus countries, exacerbated by global tariff and non-tariff barriers that divert excess metal into India. Despite substantial domestic capacity, imports are projected to meet nearly 55% of India’s aluminium demand in FY26.

The federation highlighted ongoing investments of over Rs 1.5 lakh crore in expanding aluminium capacity, with another Rs 1.6 lakh crore planned to raise primary aluminium output to 7.2 MTPA by FY30 and around 9 MTPA by FY33, in alignment with the Aluminium Vision Document released by the Ministry of Mines. These investments are expected to generate more than 8 lakh jobs and strengthen supply chains crucial for the government’s ‘Viksit Bharat’ vision.

FIMI also raised concerns about the sharp rise in aluminium scrap imports. India has become the world’s largest importer of scrap due to the absence of quality controls and BIS standards, resulting in the inflow of low-grade material from the USA, EU, UAE and UK. The federation has called for urgent implementation of quality standards aligned with global benchmarks.

To relieve cost pressures on domestic producers, FIMI recommended reducing customs duties on critical raw materials. Despite abundant bauxite and coal reserves, Indian aluminium producers face some of the world’s highest production costs, with taxes and duties alone accounting for nearly 17 per cent.

FIMI urged the government to adopt its recommendations to revive mining activity, boost exports, create jobs and attract fresh investments, supporting the goals of Make in India and Atmanirbhar Bharat.